SCIB focuses on growing business

It has set RM2.5b for bidding exercise and to a 30% dividend policy for shareholders 

by LYDIA NATHAN / pic by TMR FILE

SARAWAK Consolidated Industries Bhd (SCIB) remains steadfast in its business plans, seeking to rebuild investors’ confidence after its share price was dragged down by accounting issues involving Serba Dinamik Holdings Bhd. 

Group MD and CEO Rosland Othman emphasised that SCIB is a separate company with different business segments than Serba Dinamik despite having a common substantial shareholder in Datuk Mohd Abdul Karim Abdullah. 

“SCIB is committed to regaining investors’ confidence after investors linked the audit issues of Serba Dinamik to the company. 

“We have set an annual target size of RM2.5 billion for our bidding exercise in addition to a 30% dividend policy for our shareholders as part of our commitment to our loyal shareholders to partake in profit sharing,” Rosland told The Malaysian Reserve. 

He said SCIB is committed to ensuring the company’s performance remains optimum as best it could. 

Rosland added that SCIB will be focusing on its expansion plans by securing more contracts domestically and internationally. 

The group has a firm foothold in East Sarawak with links to several mega infrastructure projects valued at RM22 billion. SCIB has submitted a tender for a road maintenance project in Sarawak worth RM45 million, Rosland stated. 

“In early 2021, we managed to secure a few projects related to PR1MA Corp Malaysia, Perumahan Penjawat Awam Malaysia and renovation and upgrading works for National Mosque in Kuala Lumpur, which marks the start of our expansion into Peninsular Malaysia,” Rosland said. 

Additionally, the company also diversified into the healthcare segment through the construction project of medical healthcare facilities in Johor worth about RM200 million. 

SCIB is finalising to undertake an engineering, procurement, construction and commissioning project worth RM7 million besides vying for transportation hub facilities project in Kelantan, he added. 

On the international market, Rosland said the company sees opportunities in Indonesia as the government relocates its capital from Jakarta to Kalimantan. 

He added business opportunities are present for facilities relating to the FIFA World Cup in Qatar in 2022, in Oman’s special economic zones and the United Arab Emirates’ World Expo. 

SCIB shares declined 2.31% to 64 sen yesterday to give a market value of RM311.54 million. 

The counter’s price has dropped 40% since June after Serba Dinamik’s audit issues were raised in late May, causing SCIB to lose nearly RM211 million in market value. 

Rosland said the company is aware how the audit issue affected investors’ sentiment on SCIB, given Serba Dinamik’s largest share-holder and group Mohd Abdul Karim’s role as SCIB chairman and as a major shareholder. 

“SCIB has an independent and experienced management team that has proven its capability in winning and managing new projects for the group,” he said. 

Last week, KPMG PLT resigned as external auditors for SCIB with immediate effect. KPMG was also the external auditor at Serba Dinamik prior to its resignation there. 

The Sarawak-headquartered concrete products producer stated it received a notice in writing on July 23, 2021, from KPMG on the resignation. 

The external auditors resignation followed an inter alia seeking legal advice due to concerns whether 

KPMG is able to continue acting independently in their capacity as auditor in light of the similarities it shared with Serba Dinamik. 

Following that, KPMG has in its notice stated the views and opinions of the company on KPMG’s independence, coupled with the potential of a claim by the company has compromised KPMG’s ability to continue to independently discharge their professional duties as auditor of the company. 

Rosland said the group will name a new auditor in place of KPMG and is committed to complete its audit reporting by October. 

Serba Dinamik’s former external auditor KPMG had raised concerns about billions of ringgits of sales transactions (RM2.3 billion), resultant trade receivables balances (RM652 million) and materials on-site balances (RM569 million) involving 11 customers’ confirmations for the group’s financial statements ended Dec 31, 2020. 

KPMG also raised issues on 10 local suppliers with a total purchase transaction of RM798 million. 

There were also issues with Serba Dinamik’s customers and suppliers in Bahrain, and local IT contracts. KPMG resigned as the external auditors for Serba Dinamik in June after the latter decided to take legal action against KPMG.